“Baseball is 90% mental, the other half physical.” -Yogi Berra
Stay on Top of Market Trends
The Carson Investment Research newsletter offers up-to-date market news, analysis and insights. Subscribe today!
"*" indicates required fields
First things first, don’t ever invest based on who wins the Super Bowl. Or what color #87 Taylor Swift will wear at the big game, or the coin toss, or how bad the refs will be. With that out of the way, it is Super Bowl season, and that means it is time to talk about the always popular Super Bowl Indicator!
The Super Bowl Indicator suggests stocks rise for the full year when the Super Bowl winner has come from the original National Football League (now the NFC), but when an original American Football League (now the AFC) team has won, stocks fall. Of course, this is totally random, but it turns out that when looking at the previous 57 Super Bowls, stocks do better when an NFC team wins the big game. But as Yogi playfully told us in the quote above, sometimes things don’t always add up, and investing based on this won’t.
This fun indicator was originally discovered in 1978 by Leonard Kopett, a sportswriter for the New York Times. Up until that point, the indicator had never been wrong.
We like to make it a little simpler and break it down by how stocks do when the NFC wins versus the AFC, ignoring the history of the franchises. As our first table shows, the S&P 500 gained 10% on average during the full year when an NFC team won versus 7.5% with an AFC team won.
So, it is clearcut that investors want the 49ers to ground the Chiefs and win, right? Maybe not, as stocks have gained the full year 11 of the past 12 times when a team from the AFC won the championship going back 20 years. In fact, the only time stocks were lower was in 2015, when the full year ended down -0.7%, so virtually flat.
By my math, there have been 57 Super Bowls and 22 different winners. I broke things up by franchise and city. For instance, Baltimore has won three championships, with one for the Colts and two for the Ravens. So I differentiated the two. Then the Colts won one in Indy, so I broke that out as well. Either way, I still don’t see my Bengals on here, but I expect that to change next year after Joe Burrow heals up! Remember, he is the only man who owns Patrick Mahomes and Josh Allen with a 5-1 record against them combined, but I digress.
Getting to the two teams in it this year, the Chiefs have won it all three times and stocks gained 13.5%, while the 49ers have won it all five times and stocks soared 19.2% on average.
It might not matter who wins, but by how much they win. That’s right, the larger the size of the win, the better stocks do. (Let’s have another disclosure that nearly everything I’m saying here isn’t in any way, shape, or form related to what stocks actually do, and you shouldn’t use it as such.)
That’s right, when it is a single digit win in the Super Bowl, the S&P 500 is up less than 6% on average and higher about 60% of the time. A double-digit win? Things jump to about 11% and 79%. And wouldn’t you know it, when the final score is three touchdowns or more, the S&P 500 gained 13.6% for the year and is higher about 85% of the time.
Here’s a list of all the big blowouts and what happened to stocks those years. Not too bad, huh?
Here are ten other takeaways I noticed while slicing and dicing the data:
- The NFC has won 29 Super Bowls and the AFC 28.
- The Steelers and Pats have won the most at six, but the 49ers sit at five and could match them with a win.
- As great as Peyton Manning was, he only won two Super Bowls. His brother also won two. Odds are their kids will win a few more. Omaha, Omaha!
- The Lions, Browns, Jags, and Texans have still never made the Super Bowl.
- The NFC won 13 in a row from 1985 (Bears) until 1997 (Packers).
- The Bills made the Super Bowl four consecutive years, losing each time.
- The highest scoring game was 75 total points in 1995 between the 49ers and Chargers.
- The lowest scoring game was only 16 points in 2019 when the Pats beat the Rams.
- The closest ever was a one-point win for the Giants over the Bills in 1993 (the Scott Norwood game).
- In 1990 the 49ers beat the Broncos by 45 for the largest win ever.
So, there you have it, your complete breakdown for the big game. I’m saying the 49ers, as they have the better offensive and defensive lines. But Mahomes, Swift and Kelce, and the Chiefs are awesome, and it’ll likely be a great game. In the end, I just hope the refs aren’t the story like they have been so many times in big games!
Past performance is not an indication or guarantee of future results.